Ongwae blames Treasury for ballooning county debts

Says delays in disbursement of funds makes counties unable to pay suppliers and contractors in time

In Summary

•Ongwae was hardpressed to explain why the county’s pending bills have been ballooning in recent years

•Figures released by the National Treasury last month show the 47 counties have accumulated Sh100 billion debt

Kisii Governor James Ongwae
QUIZZED: Kisii Governor James Ongwae
Image: FILE

The National Treasury has come under criticism over the ballooning debts of county governments.

Kisii Governor James Ongwae yesterday told the Senate’s County Public Accounts and Investments Committee that Treasury’s piecemeal and sometimes late disbursements have plunged most counties, including his, into huge debts.

Ongwae appeared before the panel to answer to 2017-18 audit queries.

He was at pains to explain why the county’s pending bills have been ballooning in recent years despite the billions of shillings received from the exchequer.

According to the Auditor General’s report on the financial operations of the county, Kisii’s pending bills stood at Sh1.26 billion as of June 30, 2018.

Figures released by the National Treasury last month showed all the 47 counties have accumulated debts amounting to Sh100 billion.

“We receive money monthly from the Treasury and this makes it very difficult for us to plan and pay our bills in time,” he told the committee chaired by Homa Bay Senator Moses Kajwang'.

“There is a dangerous trend in the counties in that they are not absorbing development money but they continue to incur debt. Kisii is not an exception,” Kajwang' said.

The county chief sought the Senate to prevail on Treasury to release funds quarterly for proper planning of the county projects.

Ongwae, who is chairman of the human resource sub-committee of the Council of Governors, said in the past financial year Treasury has been disbursing huge sums running into billions of shillings a night to the end of a financial year.

“Last year, for instance, we received Sh1.3 billion hours to the next financial year and as such we could not spend the money and we are forced to push it forward to the next financial year,” he said.

He said his administration is unable to pay suppliers and contractors on time and the same is captured by the Auditor General in his report in the previous financial year.

The Public Finance Act 2012 mandates the National Treasury to disburse money to counties at the beginning of every month, legislation the governor wants to be amended to compel the Treasury to disburse the funds quarterly.

Ongwae defended the Sh465 million that was captured in the Auditor’s report to have been paid for wireless access point corporate. He said the money was for a county access road but was erroneously captured in the procurement plan.

“This item description was erroneously selected from the drop-down lists as a wireless access point instead of county access roads,” he said.

The governor was also hard-pressed to explain why the county’s wage bill sharply rose from 38 per cent in 2016-17 to 46 per cent last year.

“What is the justification for this, because the law requires that wages must not go past 35 per cent,” Kisii Senator Sam Ongeri asked.

The governor explained that his administration incurred Sh500 million in staff emoluments after the Council of Governors and the Ministry of Health agreed to increase doctors' and nurses' salaries after a long strike.